Let’s start with Asian equities which closed mostly in the red on Wednesday as investors digested the latest data on US inflation. The US Consumer Price Index for October rose by 2.6 percent annually, in line with expectations. However, it increased uncertainty around the Federal Reserve’s future interest rate cuts. While another rate cut is still expected this year, experts anticipate the Fed may not be as aggressive as previously thought. As a result, Hong Kong's Hang Seng dropped over two percent, and China's CSI 300 also lost almost two percent. Japan’s Nikkei fell by half a percent, as the Japanese yen slid to its lowest level in four months against the US dollar.
Back home, Indian equities ended almost flat for the day, marking the sixth consecutive session of declines. The Sensex slipped by over 100 points, closing below 77,600, while the Nifty ended just above 23,500. However, midcaps showed some resilience, with the midcap index gaining nearly 250 points. Among the fifty constituents of the Nifty, 29 declined while 21 managed to close in the green. Eicher Motors was the standout performer, surging by 6.5 percent. On the other hand, FMCG giant Hindustan Unilever saw the sharpest drop, falling nearly 3 percent.
Shifting focus to the monetary policy space – Commerce Minister Piyush Goyal has advocated for a rate cut by the Reserve Bank of India, just weeks ahead of the Indian central bank’s next monetary policy meeting starting December 4. Speaking at a CNBC-TV18 event, the minister argued that high interest rates won’t be effective in curbing food inflation. He said, and I quote, “Food inflation has nothing to do with managing inflation.
It’s time that policymakers and monetary policy authorities should sit together and decide if food inflation needs to be part of calculating headline inflation. There should be a serious thought on this,” end of quote. These comments come as India's retail inflation has surged past the RBI’s upper tolerance level of six percent, largely driven by rising food prices.
In the startup space, ride-hailing app Rapido has significantly narrowed its losses by 45 percent in the fiscal year 2024. The company’s losses dropped from 674 crore rupees in FY23 to 371 crore rupees in FY24. Rapido also reported a substantial increase in operating revenue, reaching 648 crore rupees—a 46 percent year-on-year rise. This improvement was attributed to the startup’s expansion into new business segments and increased customer bookings.